Suppose a lender enters into an FRA, where the lender will receive 9%, measured with annual compounding, for the fourth year and pay LIBOR on a principal of $15,260. The forward LIBOR rate (annually compounded) for the fourth year is 9.5%. Suppose that risk-free zero interest rates with continuous compounding are as follows:

Maturity(years)	Rate (% per annum)
1	2
2	3
3	4
4	6
5	7

What is the forward rate for the 4^th year? (Sample answer: 2.50%) [x] What is the cash flow to the lender at the end of the term (at T=4)? (Sample answer: $25.50 or -$25.50) [y] What is the Value of the FRA to the lender (at T=0)? (Sample answer: $25.50 or -$25.50) [z]